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Everybody wants to go to heaven; but nobody wants to die. - Peter Tosh

Insiders in financial companies have purchased more of their stock in August than in any other month for the past 3 years; this is a significant development. Insiders are usually privy to knowledge that is not available to the average investor- when they become aggressive buyers; it’s usually for a good reason. Insiders have been rather aggressive with their purchases in the following six companies.

Stock

Market Cap

PE

LT debt to Equity

Revenue

Dividend

Price/sales

ROE

BK

25.11B

9.5

2.2

14.7 B

2.6

N/A

34%

ARCP

10.58 million

N/A

N/A

9.51 million

6.88

N/A

N/A

MLI

1.65B

16.6

0.2

2.3B

0.9

0.8X

14.5%

JEF

3.22B

10.2

1.3

2.85B

2.10

1.1X

9.1%

SWS

170.18 million

9.02

0.0

291 million

0.8%

0.4X

-6.5%

OI

2.89B

6.11

1.25

7,01B

N/A

0.4X

10.71

Bank of New York Mellon (NYSE:BK)

BK provides a complete range of banking, and asset-management services. The Wealth segment provides estate planning, investment management, and private banking solutions to high net worth clients, foundations, endowments, etc.

Insiders have been aggressively loading up this stock. CEO Gerald L. Hassell bought 50,000 shares of Bank of New York Mellon for $1,003,305, at an average price of $20.0. What makes this purchase special is that its Hassell’s first open market purchase. He has either exercised options or sold stock in the past. His total stake in BK is 556,549 shares.

Chief Financial Officer Thomas P. Gibbons bought 25,000 shares for $509,200 on Sept. 2 bringing his total holdings to 362.431. Vice Chairman Curtis Arledge purchased 52,000 shares for $1 million on Aug 10; his total stake is now 601,468 shares.

BK historically trades at a premium to the SP 500 but is now trading at deep discount. CEO B. Kelly stepped down suddenly but was replaced by Gerard Hassell, a veteran of the company who has spent his entire career at this bank- thus the transition should be smooth.

Argus research has a 12-month buy rating on BK.

American Realty Capital Properties (NASDAQ:ARCP)

It is in the business of acquiring single tenant, free standing real estate that is then leased out (medium term basis) to credit worthy tenants. It also invests in office, retail and warehouse properties. As the Dec 2010 its portfolio consisted of 63 single tenant, free standing properties. It was founded in 2010 and is located in New York City, NY.

Insiders have been piling into this stock in September. CEO N. Schorch purchased 1,325,478 shares at a total cost of over $15,906,000. W. Kahane another officer purchased an identical amount of shares. Both these transactions took place on the 6th of this month. These two officers together purchased more than 30 million dollars worth of their stock.

AMERICAN REALTY CAPITAL II, LLC, purchased roughly 1,043,478 and 282,000 shares at a total cost of $11,999,997 and $3,525,000 respectively. If we combine all the purchases made on the 6th of September, approximately 47 million dollars worth of stock was purchased in one shot.

It was founded in 2010, so it’s a new company- this needs to be taken into consideration when deploying money into this company. Insiders must feel somewhat upbeat about its prospects for they have piled hand over fist into this company.

Mueller Industries Inc. (NYSE:MLI)

The company manufactures brass, plastic, copper, aluminium and other related products. It operates in two segments; Original equipment manufacturers and Plumbing and Refrigeration. It's based in Memphis, TN and was founded in 1900.

It is another company where insiders decided to plough huge amounts of money into their stock. Direction Joseph Steinberg purchased $12.6 million dollars worth of stock between the 6th and the 8th. He now owns 10,422,859 shares, at an average price of 44.86 and 42.40.

Director I. Cummings purchased roughly 12.6 million dollars worth of stock between the 6th and the 8th. His total holdings are also 10,422,859 shares.

In the same time period Leucadia National Corp., also purchased 12.6 million dollars worth of stock bringing their total 10,422,859 shares.

Interestingly enough, these three transactions took place on the same dates and on each occasion, identical numbers of shares were purchased.

Officer G. Christopher exercised his option to purchase 21,380 shares for a total cost of $418.009. The option was exercised in the 1$8.70-$20.40 per share ranges.

Jefferies Group, Inc. (JEF)

Founded in 1962 and located in New York City, NY, it operates as securities and investment banking company both America and Asia. It has two segments: Asset Management and Capital Markets.

CEO Richard Handler and Executive Committee Chairman Brian Friedman purchased $757,537 and $180,354 worth of shares respectively on the 15th of August. Option volume surged 490 percent above normal; buyers besieged the 2012 April 15 calls and April 15 puts. It looks like someone is hedging their bet and has opened up straddle plays. A straddle is usually purchased when one expects a large move but is not sure as to the direction of the move.

SWS Group Inc. (NYSE:SWS)

It is a full-service securities/banking firm located in Dallas, Texas, and through its subsidiaries provides a host of financial services to corporate, institutional and individual investors. The company operates in 4 segments: Institutional, Clearing, Retail and Banking.

Director Gerard Ford purchased 225,800 shares at a total cost of $1,033,010 on the 6th and 7th of September.

Owens-Illinois Inc. (NYSE:OI)

It is located in Perrysburg, Ohio, and was founded in 1903. It is part of the consumer goods sector and through its various subsidiaries manufactures and sells glass containers. Its main markets are Europe, North America, South America and Asia Pacific.

CEO A. Stroucken purchased 225,800 shares at a cost of $1,033,010 on the 6th and 7th of this month. His cost per share was in 4.39-4.82 ranges.

Conclusion

Insiders are privy to critical information that is not available to outsiders; so when they become aggressive buyers, it's time to take notice.

Source: 6 Stocks With Unusually Aggressive Insider Activity